'To address the rising price of oil in the world market we will implement immediate assistance to the masses,' she told a news conference.

'We will bring down the tariff on all petroleum products,' she said.

Finance Secretary Margarito Teves told the news conference the three percent duty on crude oil will be trimmed to two per cent, and could be further reduced to one per cent 'if crude oil prices stay at 92 dollars a barrel.'

Mrs Arroyo said she will issue an executive order Wednesday to authorise the cut. She said she will also ask local refiners to use the waived tax revenue 'to reduce the pump price of diesel', the fuel for the public transport system.

Mrs Teves said every percentage reduction in the oil tariff would lead to a pump price cut of between 23 (S$0.80) and 25 centavos a litre

However Mrs Arroyo declined to waive a 12-per cent sales tax on petroleum products, saying 'our budget deficit will balloon,' preventing the government from funding vital social programmes. -- AFP